1120S payment of legal expenses

[aerospa1]

Received legal award from court order  as result of motion of attorneys fees and cost.   Can the proceeds go into Line 5 Other income, no 1099 Misc was issued?

[MinhT1]

Yes, the legal award can be reported as Other income on form 1120-S.

[aerospa1]

When I do this it does not transfer to K1 is that correct?

[MinhT1 · Accepted solution]

Other income will transfer proportionately to the Schedules K-1 in box 10 (Other income).

[Mike9241]

if the award was made to the shareholder, that's the one who needs to report it not the S-Corp.

the award may not even be taxable.

[aerospa1]

No the award was made to the Company not the share holder.